Basing pricing on only the variable costs of a job results in suicidal underpricing. Do you agree?

Question:

“Basing pricing on only the variable costs of a job results in suicidal underpricing.” Do you agree? Why?

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Introduction to Management Accounting

ISBN: 978-0133058789

16th edition

Authors: Charles Horngren, Gary Sundem, Jeff Schatzberg, Dave Burgsta

See More Books

Question Posted: Nov 19, 2014 05:59 AM

See More Questions

How should the variable costs of a service department be charged to operating departments?
Suppose the variable costs of a medical practice increase. What types of costs might these be? How will this increase change the break-even point?
Why is underpricing not a great concern with bond offerings? Use the following information to answer the next three questions. Zipcar, the car sharing company, went public in April 2011. Assisted by...
Ritz-Carlton. The name alone evokes images of luxury and quality. As the first hotel company to win the Malcolm Baldrige National Quality Award, the Ritz treats quality as if it is the heartbeat of...
If a new coffee company had above-average profits its first couple of years but estimates of intentions to repurchase (see Figure 1-9) were declining, with customer retention expected to fall from 67...
A construction company employs 2 sales engineers. Engineer 1 does the work in estimating cost for 70% of jobs bid by the company. Engineer 2 does the work for 30% of jobs bid by the company. It is...
If you were asked to develop a training plan for an HRIS implementation, what kinds of things would you include? Why?
Chen Mo-Wan was at home when he received a call from the fire department telling him his store had burned. His business was a total loss. The insurance company asked him to prove his inventory loss....
Placid Lake Corporation acquired 8 0 percent of the outstanding voting stock of Scenic, Incorporated, on January 1 , 2 0 2 3 , when Scenic had a net book value of $ 4 8 0 , 0 0 0 . Any excess fair...
The consequence variable used in the House-Hunting example was Net Annual Cost, but as we mentioned, houses are also purchased as investments, suggesting that it might be useful to include equity and...
The distinction between precision and relevance should be kept in mind. Explain.
Many companies that use target costing involve both customers and suppliers in product and process design. Explain why.
The following facts apply to Walken Company during December 2021: a. Walken began December with an accounts receivable balance (net of bad debts) of 25,000. b. Walken had credit sales of 85,000. c....
What role did the general manager(s) of the Golden Apple Restaurant and if any the previous owners Robert and Jasmine Raveendran play in the decline of the current morale and challenges the...
Develop an information life cycle for information relating to IT equipment purchased by Match Lighting. Map the use of IT to each event in the life cycle to show how IT can be used to manage the...
Choose two businesses within the Healthy Care industry (example Hospital's): 1. Compare and contrast their operations strategy on dimensions such as cost, quality, time, and flexibility. 2. How are...
Clayton Christensen, Article: How Will You Measure Your Life? Reflect on his exhortations in the light of your own life. What are your take-aways from this speech as a leader of innovation? The...
What are hierarchical plans that address an organization's institutional-level needs and attempt to position it advantageously within its task environment called?
A hydrogen atom is in its n = 1 state. In the Bohr model, what is the ratio of its kinetic energy to its potential energy?
Provide a few individual examples who revealed what aspects of emotional intelligence?
What are the two official definitions of dumping ?
For each of the following products, suggest three measures of quality: a. Television set b. University course c. Meal in an exclusive restaurant d. Carryout meal from a restaurant e. Container of...
Many German companies have their management accounting department as part of the manufacturing operations group rather than as part of the corporate finance department. These German companies operate...
The controller of a German machine tool company believed that historical cost depreciation was inadequate for assigning the cost of using expensive machinery to individual parts and products. Each...
What is one specific security tactics to protect the network. Identify specific tools selections to accomplish compliance and audit requirement Describe how alerts would be collected and presented...
1. Solve each equation for x, where 0x & a) sin x-= 0 b) cosx-3 cosx+2=0
Explain Article III Standing, and explain how to achieve standing. b) Explain Negligence, and provide an example of a Negligence claim. c) What happened in the case of Genesco v. Visa? d) Explain the...

Basing pricing on only the variable costs of a job results in suicidal underpricing. Do you agree?

Question:

Step by Step Answer:

The variable costs of a job can be misused as a guide to pric...View the full answer

Introduction to Management Accounting

Students also viewed these Managerial Accounting questions